Jackson Fabricators Inc. machines metal parts for the automotive industry. Under the traditional manufacturing approach, the parts are machined through two processes: milling and finishing. Parts are produced in batch sizes of 60 parts. A part requires 3 minutes in milling and 9 minutes in finishing. The move time between the two operations for a complete batch is 10 minutes. Under the lean philosophy, the part is produced in a cell that includes both the milling and finishing operations. The operating time is unchanged; however, the batch size is reduced to 5 parts and the move time is eliminated. Determine the value-added, non-value-added, and total lead times, and the value-added ratio under the traditional and lean manufacturing methods. If required, round percentages to one decimal place. Traditional Philosophy Lean Manufacturing Philosophy Value-added time min min Non-value-added time min min Total lead time min min Value-added ratio (as a percent) % %
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Compute Lead Time
Jackson Fabricators Inc. machines metal parts for the automotive industry. Under the traditional manufacturing approach, the parts are machined through two processes: milling and finishing. Parts are produced in batch sizes of 60 parts. A part requires 3 minutes in milling and 9 minutes in finishing. The move time between the two operations for a complete batch is 10 minutes.
Under the lean philosophy, the part is produced in a cell that includes both the milling and finishing operations. The operating time is unchanged; however, the batch size is reduced to 5 parts and the move time is eliminated.
Determine the value-added, non-value-added, and total lead times, and the value-added ratio under the traditional and lean manufacturing methods. If required, round percentages to one decimal place.
| Traditional Philosophy | Lean Manufacturing Philosophy | |||
| Value-added time | min | min | ||
| Non-value-added time | min | min | ||
| Total lead time | min | min | ||
| Value-added ratio (as a percent) | % | % |
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